Loot Boxes: are we getting our children addicted to gambling without noticing?

Have you ever heard of loot boxes? They are quite similar to collectible sticker packets.

Loot boxes are reward boxes in video games, computer games and app games which give the user random items that may be used in game matches. By opening one in the game, the users can find characters, weapons, clothes, costumes and even dance steps, but they never know what they might encounter, specially when there are items rarer than others. In some cases, the items that come in loot boxes are sold separately in the game stores.

Loot boxes are present in very popular games such as Fortnite, FIFA 18, Overwatch and Counter-Strike: Global Offensive. They are easily accessed on any of these games and may usually be acquired in two ways: freely, but with a limited number per day, or by buying them.

Along with the surge in games came the large amount of gameplay videos, when players record their performances in a game and upload them on YouTube. In gameplays of this type of game, it has become common practice to make loot boxes unboxing* videos: youtubers buy several of them to open and comment on the items that they “won”.

How it works

Due to the random prizes, the mechanics of loot boxes in games are being compared to the mechanics of casino games: you pay for something you don’t know if you will win. In the games in question, the user will never leave empty-handed, since items will always turn up, but you never know which items will be and the probability of winning what you desire in the first loot box you open is very small.

There are other similarities between loot boxes and gambling games. The casino logic of “the more you play, the higher your chances of winning an item” is also in the mechanics of the reward boxes. There is also the color factor: casinos are quite colorful and bright. The same thing happens when a loot box is opened: the items jump on the screen and there are lights and sounds that encourage the player to play more and more.

The mechanics of loot boxes in games are cause for concern, mainly in relation to children games, for being quite similar to a casino, since gambling is addictive and children don’t understand how it works. According to NBC News, loot box practices have been drawing the attention of psychologists and anti-gambling groups, who claim that consumers of these games may exhibit addictive behavior similar to that of gambling games when they buy reward boxes.

Loot boxes around the world

Countries like Belgium and the Netherlands have forbidden the sale of games with loot boxes mechanics, but France and New Zealand don’t consider them as gambling features. The European Union is still debating whether the mechanics used are harmful to the point of being prohibited.

Loot boxes drive a 30-billion-dollar economy and are one of the most profitable sources in the gaming industry. The mechanics are not necessarily bad and harmful, but they need to be reexamined. Countries like China and South Korea have discussed the matter and demand game publishers to disclose the chances of winning each prize in the loot boxes.

The loot boxes controversy continues

The UK’s Minister for Digital and Creative Industries Margot James has taken a stand about loot boxes before the UK Parliament. According to Games.Industry.biz, James considers loot boxes a way for people to buy items and enhance their game experience without the expectation of financial return.

Margot James states that if there is evidence that loot boxes are connected to gambling problems and games of chance, then she will be concerned and agree that is necessary to take action and do something about it. However, to this moment, there has not been enough research and data regarding this subject. James defends that, in order to regulate loot boxes and ‘online bets’, research is necessary to understand the situation and justify the action (in this case, regulation).

The counterpoint to loot boxes: Immersive and addictive technology report

In the first few weeks of September, the UK’s Digital, Culture, Media and Sport Committee (DCMS) published and handed to parliamentary inquiry a 84-page report about immersive and addictive technologies, after 9 months of production. The report brings data and evidence from all sides of the gaming industry, including developers and commercial and academic institutions, and determined a “lack of honesty and transparency between social networks and representatives of game companies.”

If the government wants to maintain the same posture regarding loot boxes even after the DCMS report, the committee asked for a document explaining the reasons why loot boxes and the mechanics of gambling in video games and apps are the exception to the act of gambling.

The Committee remarked that the evidence on the potential damage caused by loot boxes (simulated gambling) remains scarce and, therefore, recommends a number of preventive approaches for the future.

Suggestions regarding loot boxes

Furthermore, the Committee suggested that the UK government should advise the PEGI** to apply the existing gambling content label and the relevant age restrictions to games that exhibit loot boxes or similar mechanics.

The report even recommends that, going further than loot boxes, the gaming industry is responsible for protecting the players against potential damage and should support independent research on “the long term effects of loot boxes and gambling mechanics”.

The DCMS Committee president Damian Collins said that “playing contributes to a global industry that generates a revenue of billions. It is unacceptable for companies with millions of users, children amongst them, to be so ill-informed they are unable to have the conversation about the possible damage of their products”.

At last, the Committee suggested that legislation is necessary to protect children from games which are not age-appropriate. This sprung from the concern that companies are not reinforcing age restrictions.

One of Explot’s backbones is science and, just like Margot James, we support that conscious decisions be made based on facts and research. But we still worry about the exposure of children to loot boxes, like the DCMS Committee. Even though, in some countries, games need to inform the chances of winning the items, children have no concept of probability, therefore, the measure to protect the users doesn’t apply to the youngest players.

*Unboxing is when someone opens gifts, packages, boxes, etc. It became popular when youtubers started making videos unwrapping gifts they had won or something new they had bought.

**Pan European Game Information, game content evaluation system created to help clients make informed decision before buying games, video games and apps.